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  • March 2, 2018

    Rengo Acquires Shares in Toppan Containers Co., Ltd.

    Rengo Co., Ltd. (Head Office: Kita-ku, Osaka; Chairman, President & CEO: Kiyoshi Otsubo) announces that it resolved today to subscribe for the issuance of 2,150,000 new shares by third party allotment in Toppan Containers Co., Ltd. (Head Office: 1-5-1 Taito, Taito-ku, Tokyo; Representative: Takayuki Yamamoto), a wholly-owned subsidiary of Toppan Printing Co., Ltd. (Head Office: 1-5-1 Taito, Taito-ku, Tokyo; Representative: Shingo Kaneko), and to acquire 340,000 common shares from Toppan Printing (“the Acquisition of Shares”) to make Toppan Containers a subsidiary of Rengo, and it has concluded agreements on the subscription for shares and the share transfer with Toppan Containers and Toppan Printing, respectively.

    The Acquisition of Shares and the share transfer are subject to anti-monopoly law-related approval by the Fair Trade Commission of Japan and the Ministry of Commerce of the People’s Republic of China.


    1. Reasons for the Acquisition of Shares

    The Rengo Group, as a “General Packaging Industry,” a comprehensive packaging provider that actively makes proposals which are capable of fulfilling all of the packaging needs of various industries, is making every effort to expand its business operations and improve its earning capacity through strengthening of its marketing ability by means of innovative packaging, actively making capital investments and M&As, and reorganization of businesses in order to further develop its hexagonal business structure with its six core business fields (Paperboard, Corrugated Packaging, Folding Cartons, Flexible Packaging, Heavy Duty Packaging and Overseas Operations).

    Toppan Containers, the shares in which will be acquired by Rengo, has three corrugated board plants in Japan (Kawaguchi-shi in Saitama Prefecture, Sano-shi in Tochigi Prefecture and Ishinomaki-shi in Miyagi Prefecture) and is manufacturing corrugated packaging, orders for which are mostly received by Toppan Printing from its customers. Toppan Containers’ corrugated production at the three factories combined was a monthly average of approximately 11.4 million square meters in the fiscal year ended March 31, 2017.

    A pressing task of the Rengo Group is to expand its supply capacity of corrugated packaging in the Kanto region where demand for corrugated packaging is growing significantly. Rengo will consider actively making capital investments in Toppan Containers’ plants, and will organize systems to more fully satisfy customers’ future needs by enhancing the production capacity of corrugated packaging and further improving quality.

    Even after Toppan Containers has become a subsidiary of Rengo, it will continue the employment all of its employees and will be responsible for distribution channels and supply relating to corrugated packaging with Toppan Printing. Also, Rengo and Toppan Printing will engage in improving Toppan Containers’ performance by cooperatively assisting it with the purchasing of raw materials, production and logistics (excluding sales).


    2. Overview of the Subsidiary to be Acquired (Toppan Containers)

    (1) Name Toppan Containers Co., Ltd.
    (2) Location

    1-5-1 Taito, Taito-ku, Tokyo

    (3) Title and Name of
    Representative
    President and Representative Director: Takayuki Yamamoto
    (4) Main Business Manufacturing of corrugated board and boxes
    (5) Capital 1,000 million yen
    (6) Date of Establishment October 1, 1952
    (7) Major Shareholder and its Shareholding Ratio Toppan Printing Co., Ltd.100%
    (8) Relationships with Rengo Capital Ties Nil
    Personal Relationships Nil
    Business relationships Paperboard, etc. transactions with Rengo and its group companies
    (9) FY ended March 31, 2017
    ・Net Sales 18,951 million yen
    ・Corrugating Production 137 million m2

    After the acquisition of shares, the trade name, etc. of Toppan Containers will be changed as shown below.


    Name Rengo Toppan Containers Co., Ltd.
    Location

    2-32-1 Hachimangi, Kawaguchi-shi, Saitama Prefecture
    (location of Saitama Plant)

    Representative Will be dispatched from Rengo
    Capital Approx. 3,150 million yen
    Shareholder Composition Rengo 60.0%, Toppan Printing 40.0%

    3. Number of Shares Acquired, Acquisition Cost and Change in Shares Held by Rengo Due to Acquisition

    (1) Number of Shares Held Before Acquisition 0
    (2) Number of
    Shares Acquired
    Subscription for capital increase 2,150,000 shares
    Share transfer 340,000 shares
    Total   

    2,490,000 shares

     (Ratio to total number of issued shares: 60.0%)
    (3) Acquisition Cost Toppan Containers’
    common shares

    Approx. 5,000 million yen

    (Breakdown: subscription for capital increase 
    approx. 4,300 million yen; share transfer 
    approx. 700 million yen)

    Advisory fees, etc. Approx. 20 million ye
    Total (estimated sum)   Approx. 5,020 million yen
    (3) Number of Shares Held
    after Acquisition
    2,490,000 shares (shareholding proportion: 60.0%)

    4. Schedule

    (1) Date of Resolution of Board Meeting March 2, 2018
    (2) Date of Conclusion of Agreements on
    Subscription for Shares and Share Transfer

    March 2, 2018

    (3) Date of Acquisition of Shares Early in July, 2018 (planned)

    5. Prospects

    The impact of the Acquisition of Shares on Rengo’s consolidated financial results for the fiscal year ending March 31, 2019 is being examined, and will be announced as soon as it is finalized.